THE CULT OF KEYNES

President Obama, Treasury Secretary Geithner and Federal Reserve Chairman Bernanke, as well as most politicians and many college professors, adhere to the economic theories of John Maynard Keynes, and champion policies prescribed by those theories. Keynes’ economic theories were published in his magnum opus, the General Theory of Employment, Interest and Money in 1936. Nobel-prize winner, tenured Princeton professor, and New York Times columnist Paul Krugman is Keynes’ best known disciple in America today.

Keynesianism, however, is not economics; it’s a religious cult. The mantras of Keynesian cultists are monetary inflation and government spending. Keynes once wrote that an increase in the money supply through an expansion of bank credit can perform the “miracle . . . of turning a stone into bread.” This was a subtle comparison of the power of state-sponsored inflation to the power of Jesus, who comes up short in Keynes’ analogy. Although Jesus turned water into wine (John 2:), when “tempted” by Satan to turn stone into bread he could not or would not do it. (Luke 4) The Keynesian religion was aptly dubbed statolatry by economist Ludwig von Mises. Those who attribute superhuman qualities to the state practice statolatry and are known as statists.

Common sense precludes membership in the Keynesian cult. You don’t need a Ph.D. in economics to know you can’t spend your way to prosperity, although you certainly can spend yourself into the poor house. Keynesian economists might not deny this as pertains to individuals, but they insist the state can create prosperity through government spending. In other words, the state, comprised of less-than-exceptional human beings, can do things no individual nor other group of individuals can accomplish. Thus they attribute divine, angelic, or super-human powers to government, and worship at the alter of the almighty state.

Jesus had twelve Apostles and many disciples. Keynes himself was an Apostle, not of Jesus, but as a member an exclusive, secret society at Cambridge University by that name, whose members considered themselves intellectual elites. In a letter to fellow Apostle Giles Lyttton Strachey, Keynes wrote, “Is it monomania–this colossal moral superiority that we feel? I get the feeling that most of the rest never see anything–too stupid or too wicked.” Keynes was indeed afflicted with monomania. His belief in the power of a government–at least in one counseled by him–to duplicate God’s miracles of creation was unwavering. Keynes, too, has many disciples, although epigones, minions or sycophants more accurately describes them.

Keynes wrote only one book on economic theory, his The General Theory of Employment, Interest and Money. It became a worldwide hit because it was thought to provide economic justification for spending OPM (sounds like opium, is equally addicting, stands for “other people’s money–forcibly extorted”), which politicians, bureaucrats and government economist everywhere eternally lust to spend. Keynes was indirectly responsible for creating the job-title “government economist,” a position open to Ph.D.s who endorse Keynes’ spending mantra, for which they are in turn remunerated handsomely.

Keynes’ GT is almost unreadable. One of his own disciples, Paul Samuelson, said of it, “It is a badly written book, poorly organized; any layman who, beguiled by the author’s previous reputation, bought the book, was cheated of his five shillings…It is arrogant, bad-tempered, polemical, and not overly generous in its acknowledgements.” Nevertheless, addicted to OPM and a fervent disciple of Keynes, Samuelson could ignore its shortcomings and conclude, “It is a work of genius.”

As opposed to Keynes, Henry Hazlitt, was the twentieth century’s most lucid economic writer. His 1959 book, The Failure of the New Economics, is the only detailed, chapter-by-chapter analysis of the entire, oh-so-ponderous, General Theory. Hazlitt’s conclusion: “I have been unable to find in it a single important doctrine that is both true and original. What is original in the book is not true, and what is true is not original…even much that is fallacious in it is not original, but can be found in a score of previous writers.” Hazlitt’s merciless critique drove a stake through the heart of Keynesian economics, but the cadaver still stalks the nation’s capitol and its ivory towers. That is because Keynesianism is the only “school of economics” that rationalizes governments spending beyond what is necessary to meet legitimate expenses; and because OPM eaters can never get enough of taxpayers’ stuff.

Disciple of Jesus, Voluntaryist, Writer, "Tax Denier" (current IRS term) Illegal-Tax Protester (former IRS designation to which I added a hyphen to make what I protest clear), Founder, 2nd Abolition Movement rid American of the enslaving individual income tax.